Electronic Arts, known for popular video game titles such as Madden NFL, Battlefield, and The Sims, is set to be acquired for a record-breaking $55 billion US in the largest leveraged buyout attempt in history. The deal, announced recently, will see private equity firm Silver Lake Partners, Saudi Arabia’s sovereign wealth fund PIF, and Affinity Partners pay $210 per share to the company’s stockholders. Affinity Partners, led by Jared Kushner, son-in-law of President Donald Trump, is one of the acquiring parties.
The acquisition will take Electronic Arts (EA) private, surpassing the previous record of $32 billion paid in 2007 to privatize Texas utility TXU. This move will mark the end of EA’s 36-year history as a publicly traded company, which began with shares trading at 52 cents on its first day post IPO. Founded by William “Trip” Hawkins, a former Apple employee, EA ventured into the gaming industry after Hawkins’ passion for sports simulations dating back to his teenage years.
Presently under the leadership of CEO Andrew Wilson since 2013, EA operates multiple studios and offices in various locations across Canada, including Edmonton, Montreal, Toronto, Vancouver, and Victoria, B.C. The acquisition by Silver Lake Partners comes shortly after their involvement in a significant tech deal related to TikTok, indicating a strategic move in the technology sector.
Transitioning to private ownership will allow EA to revamp its strategies without the quarterly financial pressure faced by publicly traded companies. Despite a loyal fan base, EA’s revenue has remained relatively stagnant in recent years, contrasting with the industry’s dynamic landscape. Notably, EA’s competitor, Activision Blizzard, was acquired by Microsoft for nearly $69 billion in 2023, while the mobile gaming sector, exemplified by companies like Epic Games, continues to intensify the competition.
Private companies often undergo restructuring post-acquisition, which may include layoffs; however, EA has not indicated any immediate workforce reductions. In 2024, EA downsized about five percent of its employees, bringing its total workforce to 14,500 by March, followed by additional layoffs in May.